- When it comes to its peers in the absolute return space, Jones said one of the fund’s main differentiators is its alpha source.
- “It is about human beings doing deep fundamental research and the access to a proprietary data set that you cannot get outside of Fidelity,” he said. “The edge is combining this research, with a systematic, repeatable portfolio construction process.”
- A second differentiator, added Jones, concerns its transparency. “This is not an algorithm and it’s not a black box,” he said. “Investors are able to see exactly how every stock gets in or out of the portfolio based on human beings doing their deep fundamental research.”
- While the fund was launched in 2020, Jones said it applies the same philosophy as the Fidelity Research Strategy (FIRSt) which he helped design and launch with fellow manager Hiten Savani in 2013.
- In a sector beset with accusations of failing to deliver on its stated objective, Jones said the fund has delivered on its long-term goal of outperforming cash with a target of cash plus 3% to 5% per year over the cycle, gross of fees.
- “Since launch, the fund has delivered returns ahead of SOFR (Secured Overnight Financing Rate) and has also compared well against peers on risk-adjusted measures,” he said. “Of course, past performance is not a guide to future returns, but the live track record has been encouraging.”